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March 25, 2020 SPECIAL COVID-19 ISSUE

UNITED KINGDOM – General Response

By: Nicola Whiteley and Mandy Perry, Orrick, Herrington & Sutcliffe LLP, London

Until very recently, the UK government has taken a fairly non-interventionist approach to dealing with the coronavirus in the workplace, encouraging employers and employees to take certain actions but with no enforcement or aid. However, as numbers increase, this is now changing dramatically. The most significant workplace developments to date are as follows:

  • The government had already advised that businesses and workplaces should encourage their employees to work at home, wherever possible. In the last week, this has become more widespread, with most businesses now operating remotely unless an in-person presence is unavoidable.  With effect from Friday 20 March 2020, all nurseries and schools have been closed, except for the children of key workers or vulnerable children, so parents and employers now need to adjust to the new regime of remote working but without childcare and with home schooling thrown in.
  • Employees had been encouraged to self-isolate if, for example, they developed any potential symptoms or had travelled to certain areas or had close contact with someone exhibiting symptoms. Ordinarily, employees on sick leave are only entitled to a minimum rate of statutory sick pay from their employer if they have been on sick leave for four days or more.  In order to encourage self-isolation of those with potential coronavirus symptoms, in order to try to minimise further spread, the government announced that:
    • this benefit would be applied from the first day of sick leave, not the fourth, and no doctor's note would be required in potential coronavirus cases;
    • It would also apply to those self-isolating, not just those who are actually sick; and
    • the government would reimburse small and medium sized businesses (fewer than 250 employees) for the first two weeks of that pay.
  • On Friday 20 March 2020, the Government announced that all pubs, bar, restaurants, cafes, gyms, nightclubs, theaters and cinemas must close effective immediately. In practice, many businesses were already considering closure, significant reductions in force or unpaid "furloughs" for employees, as a result of the dramatic drop in trade and overall effects of the pandemic. To minimise the impact of this situation and help retain jobs, the government simultaneously announced that it will pay (via a reimbursement from HMRC, the tax authority, backdated to the start of March) up to 80% of wages (subject to a cap of £2500 per month) to any employer for an employee who is designated as a "furloughed worker" rather than being made redundant (the Coronavirus Job Retention Scheme). Note that there is no law in the UK which permits unpaid furloughs or lay-offs, or even short-time working, unless in each case there is an express provision in the contract which allows for this and even then, it is subject to consultation and not always straightforward. However, the government's announcement is likely to make it easier for the employer to negotiate agreement from their employees to take furloughs in order to avoid redundancy terminations.

Nicola Whiteley

Orrick, Herrington & Sutcliffe LLP, London

Mandy Perry

Orrick, Herrington & Sutcliffe LLP, London